Continued strength in the S&P Retail Index (RLX.X) has us
thinking that WSM has room to run. The stock performed a slow
meltdown towards the end of last week, but also managed to fill
the gap created on 4/30. This is technically significant since
WSM bounced right off the lower portion of the gap and closed in
the upper portion of its daily range on Friday. It also did this
gap filling move on strong volume of 965,000 shares. WSM's
three-month average daily volume is only 570,000 shares. On
Monday, we will look for a move above Thursday's closing price of
$31.15 as a good entry point for new plays on what we hope is
optimism going in to the Fed meeting on Tuesday. Look for volume
to exceed 200,000 by midmorning. We are keeping our stop at
$27.75 to protect against any post Fed announcement volatility.